China and Russia Leaving Global Banking System – Russia and China Dumping US Dollar For Gold

China and Russia Creating Alternate Banking System

By James Corbett

It may have arrived with little fanfare, but Russia’s SWIFT alternative has, more or less, arrived.

Speaking in no uncertain terms at a meeting with Russian President Vladimir Putin late last month, Elvira Nabiullina, the Governor of Russia’s central bank, stated: “We have finished working on our own payment system, and if something happens, all operations in SWIFT format will work inside the country. We have created an alternative.”

Now this news will be old news to intrepid Corbett Reporteers. My long-term audience will no doubt recall the September 21, 2014 episode of New World Next Week where James Evan Pilato and I covered the Russia/China talks to create both a SWIFT alternative and an independent ratings agency. You’ll also of course recall my March 11, 2015 editorial in these very pages where I discussed then-recent reports that China was ready to go live with its own SWIFT alternative, the Cross-Border Inter-Bank Payments System. For those not following along at home, that system did indeed go live in October of that year, but in a “watered down” form that only accounts for cross-border yuan trade deals, not capital-related transactions.

But for those who are really lost in the woods, let’s go back to my “China’s SWIFT Alternative and the (Engineered) Death of the Dollar” editorial to re-establish just what SWIFT is and why alternatives to it are so potentially important. As I wrote at the time:

“For those who don’t know, SWIFT stands for the Society for Worldwide Interbank Financial Telecommunication and is shorthand for the SWIFTNet Network that is used by over 10,500 financial institutions in 215 countries and territories to transmit financial transaction data around the world. SWIFT does not do any of the clearing or processing for these transactions itself, but instead sends the payment orders that are then settled by correspondent banks of the member institutions. Still, given the system’s near universality in the financial system, it means that virtually every international transaction between banking institutions goes through the SWIFT network.”

This is why the SWIFT system is so important to the global economy and why it was a significant hamper to the Iranian economy when 30 Iranian financial institutions (including the central bank) were de-listed from the SWIFT network in 2012. And this is exactly why China and Russia have been so keen on setting up an alternative infrastructure of their own, just in case the “completely independent” SWIFT organization acts as a proxy weapon for the US State Department and its pals at some point in the future.

Now this latest announcement about the Russian SWIFT alternative is not new news, per se. The system was already up and operating on a trial basis among “several dozen banks” in 2015. Governor Nabiullina’s latest pronouncement is more of a reassurance that the Russian economy will be able to continue in the event of anything, including a de-listing from SWIFT. As the latest reports reveal, 330 banks are now on the system. What’s more, fully 90% of Russia’s ATMs are now able to accept the Mir payment system, the Russian alternative to Visa and Mastercard.

Now maybe these stories taken by themselves are no big news. But let’s look at them in the context of recent events:

Russia just created its first ever representative office of the Bank of Russia abroad…in Beijing. This move brings Russia one step closer to issuing its own sovereign yuan-denominated bonds.

Meanwhile the Industrial and Commercial Bank of China is now officially acting as a renminbi clearing bank in Russia, which expands local settlement business in direct yuan-ruble trade and follows Russia’s 2015 inclusion of the renminbi on its official reserve currency list.

Are you starting to see the bigger picture? Again, no one of these stories is a silver bullet, but they’re all related and they all point in the same direction: China and Russia are preparing for the inevitable(?) split with the US-dominated, dollar-denominated, SWIFT-networked global(ist) financial architecture.

Now there are some caveats to this before we start converting all our cash to yuan and moving to Vladivostok. As it turns out, every single one of these moves are either baby steps, the beginning moves that might one day lead to baby steps, or steps backward disguised as baby steps.

Like that Chinese SWIFT alternative, the CIPS system. It was originally being touted as a rival to SWIFT. Then, as we’ve seen, it was “watered down” and became something like an adjunct to SWIFT. Then in March 2016 CIPS actually signed a memorandum of understanding with SWIFT to use SWIFT’s own platform for transmitting its messages. CIPS is now, if not an all-out subsidiary of SWIFT, at least just another one of the 150 or so payment networks that make use of the SWIFT network. So China has actually made no progress whatsoever toward safeguarding itself from a SWIFT de-listing.

And Russia’s newly (re)announced SWIFT alternative? It has some considerable limitations of its own. As RT reports, the system “doesn’t work from 9pm to 5am Moscow time and costs up to five cents per wire transfer, which is regarded expensive.”

And Russia’s Mir payment system? The homegrown Mastercard/Visa alternative that is now readable at 90% of the country’s ATMs? Well wouldn’t you know it, a suspiciously well-engineered virus has just infected the country’s ATM network, causing the machines to release all their large denomination banknotes when a certain code is entered. As Russia Beyond the Headlines intriguingly notes: “The virus does not have a file body, so it is not recognized by antivirus programs. It can therefore exist in the operating memory of an ATM for an unlimited time. It is the first time such a virus has been detected in Russia.”

So it’s not like the path from here to the Sino-Russia (New) New World Order will be all sunshine and rainbows. But who was expecting that? There are very real, very entrenched interests that have everything invested in the current unipolar Bretton Woods system (or at least what’s left of that system), and there’s going to be some very real resistance to whatever is emerging from China and Russia…

…However, as always (and regular readers know what’s coming), we have to be aware, too, that there are other power players whose interests lie in the very conflict between competing world systems that we see emerging. Just as the world of Orwell’s 1984 was divided into “Eurasia” and “East Asia” and “Oceania,” so too are we increasingly being prepared for a NATO bloc / BRICS bloc world. And just as the citizens of Orwell’s fictional world had no way to know if the attacks they were hearing about every day were really coming from their enemy of the week or from their own government, so too is our world fast becoming a nightmare of false flag events and stage-managed conflicts to make sure the ruling oligarchy is never challenged.

As Henry Kissinger once observed: “What we in America call ‘terrorists’ are really groups of people that reject the international system.” Increasingly, that “international system” includes both the NATO/World Bank/IMF/SWIFT nexus of military and financial power as well as its BRICS mirror image counterparts. The “terrorists,” then, according to collectivists like Kissinger, are the people who refuse to be grouped into either of these categories.

This is why we have to understand these moves toward the decoupling of the East and West as attempts to herd the masses into regional blocs as part of a broader scheme of globalization. Whether the end goal of global government is ever openly arrived at or only functions behind the scenes by tacit accord between the supposed rivals (like CIPS and SWIFT or like the BRICS Bank and the World Bank), the end result is the same: you belong to one identity-subsuming collective.

If only there was a way out of this bind.

If only there were ways of transacting with others that bypassed central banks altogether.

If only there were forms of organization that did not rely on political messiahs to wisely shepherd us into the right flock for the great sheering.

If only we could imagine a world where people could prosper through freedom rather than suffer under oppression.

But nope, I guess that’s impossible. We’ll all just have to rally around the NATO flag or the BRICS flag and defend that decision as if it’s one we made rather than one we were engineered into. Unless we act like the majority and simply accept whatever system is placed in front of us and normalized by the media.

Resistance is futile. You will serve the BRICS. I mean the Borg. Whatever.

Happy banking!

This article (China and Russia Creating Alternate Banking System) was originally published on The Corbett Report and syndicated by The Event Chronicle.


Russia is one of the more powerful nations in the world.  With the power, however, comes enemies. One of its enemies has a slight financial hold over Russia, and that power comes in the form of Dollars. The relationship between the east and west is now at a stalemate; Moscow’s reaction to western encroachment and accusations comes from President Vladimir Putin, who has proposed to withdraw the Russian state from the international banking system, moving towards a more traditional gold-based system.

Russia isn’t alone in this. BRICS nations such as Brazil, India, China, and South Africa are all planning their exit from the international banking mafia for more financial independence.

global banking
Image Source: Google Image – Bank of Russia headquarters in Moscow.

However, for President Putin, the threat came in the form of the Worldwide Interbank Financial Telecommunication system, or the SWIFT system, which allows easy transfer of money internationally, such as via American express. The problem, however, is the international banks are threatening to bar Russian access from this system if they leave the ‘big club.’

Many economists have informed the world leaders of the consequences facing them if they remove Russia from the SWIFT system. Ewald Nowotny, an economist and a policy maker for the European Central Bank highlighted how if Russia is removed from the SWIFT system international companies conducting business in Russia will be the first to suffer.

global banking
Image Source: Google Image – The Eccles Building in Washington, D.C., which serves as the Federal Reserve System’s headquarters.

However, according to Elvira Nabiullina, a Russian economist and former economic advisor to President Putin and the head of the Central Bank of Russia, if Russia is removed from the Worldwide Interbank Financial Telecommunications then Russia’s banks won’t collapse. She explained how they have devised a new system that will continue operations in the SWIFT format and will work as an alternative for the country.

According to a report published last year, more than three hundred banks in Russia have adopted the SWIFT alternative – the System for Transfer of Financial Messages, or SPFS as the Russians call it.

global banking
Image Source: Google Image – The World Bank Group headquarters building in Washington, D.C.

Furthermore, to enhance the SPFS system, Russia’s Central Bank’s first international branch in Beijing was opened, and the Chinese opened a financial institution in Russia to strengthen the financial relationship between the two nations and the beginnings of the ‘de-dollarization’.

As for the Federal Reserve and other international financial institutions that trade in non-physical currency and futures, and all other riskier practices; are now buying bulk quantities of physical gold – leaving their old practices behind.

global banking
Image Source: Google Image – Daqing Bank’s Dalian Branch (1910), now Dalian branch of China CITIC Bank

According to Mac Slavo who writes for SHTFplan, the NGOs ran by Soros have been questioned and kicked out, along with Rothschild establishments.

“It seems that only all out war will ever settle these power plays for the dominance or death of the U.S. petrodollar, which is ultimately controlled by the same few hands that steer and control the central banks of nearly all the world’s nations,” wrote Mac Slavo. “Only by stealth and monotony have these activities remained in the shadows.”

Source: The Free Thought Project, China Daily, RT.

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